Consumption experience, choice experience and the endowment effect.
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ABSTRACT:
SUBMITTER: Humphrey SJ
PROVIDER: S-EPMC6956941 | biostudies-literature |
REPOSITORIES: biostudies-literature
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Project description:We experimentally test for the role of choice uncertainty in generating "endowment effects" - the robust empirical finding that endowing participants with an item raises their reported valuation relative to participants being asked to purchase it instead. While there is some compelling evidence concerning trade uncertainty in the literature, there is substantially less evidence regarding the importance of choice uncertainty. This paper provides novel support for the significance of choice uncertainty in the context of both trading and stated valuations. In a primary set of studies, we find that reducing choice uncertainty eliminates under-trading in the exchange setting and decreases (but does not eliminate) the difference in average valuations reported by buyers and sellers, mainly by decreasing the number of extreme valuations by sellers. Interestingly, our treatment does not lead to a significant increase in the number of mutually acceptable trades implied by stated valuations. Comparing the results from our two primary experiments therefore suggests that value uncertainty continues to play a role in generating valuation asymmetries even after relevant product uncertainty has been resolved. A set of follow-up studies with modified designs replicates this finding in the exchange setting but fails to generate a valuation asymmetry in the control condition, possibly due to pandemic-related mitigation measures and less participant time with the endowed item.Supplementary informationThe online version contains supplementary material available at 10.1007/s11166-022-09387-8.
| S-EPMC9200560 | biostudies-literature
Project description:We show that preschoolers exhibit the endowment effect as evidenced by experiments where children generally chose to keep their own toys rather than trading them for similar ones. Furthermore, we relate the emergence of this effect to children's innate psychobiological traits--emotional state, gender, handedness, and digit ratio. The trials were conducted with 141 children across 6 kindergartens. We also found support that children, like adults, exhibit a preference for physical possession as opposed to ownership. As with adults, emotions also seem to matter, as children who were described as quiet and calm were more likely to present the endowment effect. Also of note, right-handed children described as quiet were more likely to exhibit the phenomenon. Furthermore, female children were generally found to be calmer than males, while males tended to be more fearful than females. This result was also previously found in teenagers.
| S-EPMC4192123 | biostudies-literature
Project description:The endowment effect occurs when people assign a higher value to an item they own than to the same item when they do not own it, and this effect is often taken to reflect an ownership-induced change in the intrinsic value people assign to the object. However recent evidence shows that valuations made by buyers and sellers are influenced by market prices provided for the individual products, suggesting a role for beliefs about the markets. Here we elicit individuals' beliefs about whole distributions of market prices, enabling us to quantify whether or not a given transaction constitutes a "good deal" and to demonstrate how an endowment effect may reflect such considerations. In a meta-analysis and three laboratory experiments, we show for the first time that ownership has no effect on beliefs about either: (a) the quality of the item or (b) the appropriate market price for the item. Instead, we show that sellers demand a price for the item that matches their beliefs about the item's relative quality and the distribution of market prices in the market. Buyers, in contrast, offer less than what they believe the appropriate market price is. Thus, we argue that the endowment effect may largely reflect "adaptively rational" behavior on the part of both buyers and sellers (given their beliefs about relevant markets) rather than any ownership-induced bias or change in intrinsic preferences.
| S-EPMC7983076 | biostudies-literature
Project description:People's choices are often found to be inconsistent with the assumptions of rational choice theory. Over time, several probabilistic models have been proposed that account for such deviations from rationality. However, these models have become increasingly complex and are often limited to particular choice phenomena. Here we introduce a network approach that explains a broad set of choice phenomena. We demonstrate that this approach can be used to compare different choice theories and integrates several choice mechanisms from established models. A basic setup implements bounded rationality, loss aversion, and inhibition in a natural fashion, which allows us to predict the occurrence of well-known choice phenomena, such as the endowment effect and the similarity, attraction, compromise, and phantom context effects. Our results show that this network approach provides a simple representation of complex choice behaviour, and can be used to gain a better understanding of how the many choice phenomena and key theoretical principles from different types of decision-making are connected.
| S-EPMC7529946 | biostudies-literature
Project description:Endowment effect - the observation that people appear to attach more value to possessions than non-possessions - has been replicated in numerous experimental studies. Previous neuroimaging studies revealed that the medial prefrontal cortex (MPFC) plays a role in the endowment effect. To assess the possibility of a direct causal relationship between the activity of MPFC and the endowment effect, we used transcranial direct current stimulation (tDCS) to transiently alter the neural activity in MPFC. Subsequently, in three stimulation treatments, we assessed the presence of the endowment effect, which was demonstrated by a disparity between willingness to accept (WTA) and willingness to pay (WTP). The results indicated that the participants demonstrated the endowment effect for a mug in the anodal and sham treatments, whereas no endowment effect was observed in the cathodal treatment. Similarly, endowment effect was observed for the other item (notebook) in the anodal treatment, whereas no endowment effect was observed in the sham and cathodal treatments. In addition, the participants tended to sell higher and buy lower after receiving anodal tDCS over MPFC and buy higher after receiving cathodal tDCS over MPFC. As a result, the present study demonstrated a direct causal relationship between the activity of MPFC and the endowment effect.
| S-EPMC6751267 | biostudies-literature
Project description:This SuperSeries is composed of the SubSeries listed below.
2016-01-31 | GSE73867 | GEO
Project description:The value assigned to aversive events is susceptible to contextual influences. Here, we asked whether a change in the valuation of negative events is reflected in an altered neuronal representation of their expected aversive outcome. We show that experiencing an aversive event in the past, and choosing to experience it in the future, reduces its aversive value. This psychological change is mirrored in an altered neural representation of aversive value in the caudate nucleus and anterior cingulate cortex. Our findings indicate that subcortical regions known to track expected value such as the caudate nucleus, together with anterior cingulate cortical regions implicated in emotional modulation, mediate a revaluation in expectancies of aversive states. The results provide a striking example of a contextual sensitivity in how the brain ascribes value to events, in a manner that may foster resilience in the face of adversity.
| S-EPMC2923025 | biostudies-other
Project description:ObjectiveWhile COVID-19 had a profound impact on healthcare, its effects on medical students are less clear. This study explored the effects of COVID-19 safety measures on medical students' specialty selection and career choices. It further considers the potential differential effects of COVID by gender.DesignBetween June and November 2020 at a Midwestern medical university, medical students with an anticipated graduation in 2021 through 2023 participated in virtual focus group sessions, which explored students' transition to remote learning during COVID-19, perception of gender bias within medical education, and personal and professional goals. Nine focus groups were held, with two to six students per session (n = 22). Focus groups were video recorded, transcribed verbatim, and data were deidentified. Transcripts were coded and analyzed using consensual qualitative analysis to identify themes.ResultsOur analysis captured 3 themes: (1) Impact of Institutional Decision-Making due to COVID-19, (2) Impact of Unstructured Time on Professional and Personal Decision Making, and (3) Impact of Societal Pressures, Gender Bias, and Mentorship on Career Planning.ConclusionsCOVID-19 disrupted important learning opportunities for medical students. Mentorship and shadowing are critical in helping students make career and specialty decisions, particularly for women. The loss of these opportunities may have lasting career impacts for all students.
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Project description:Female choice can drive the evolution of extravagant male traits. In invertebrates, the influence of prior social experience on female choice has only recently been considered. To better understand the evolutionary implications of experience-mediated plasticity in female choice, we investigated the effect of acoustic experience during rearing on female responsiveness to male song in the field cricket Teleogryllus oceanicus. Acoustic experience has unique biological relevance in this species: a morphological mutation has rendered over 90 per cent of males on the Hawaiian island of Kauai silent in fewer than 20 generations, impeding females' abilities to locate potential mates. Females reared in silent conditions mimicking Kauai were less discriminating of male calling song and more responsive to playbacks, compared with females that experienced song during rearing. Our results to our knowledge, are the first demonstration of long-term effects of acoustic experience in an arthropod, and suggest that female T. oceanicus may be able to compensate for the reduced availability of long-range male sexual signals by increasing their responsiveness to the few remaining signallers. Understanding the adaptive significance of experience-mediated plasticity in female choice provides insight into processes that facilitate rapid evolutionary change and shape sexual selection pressure in natural populations.
| S-EPMC2605808 | biostudies-other